What happens when you sue someone with no money?

We hear this a lot. Maybe you got the idea because the other person involved in the situation has said something like, “Please don’t sue me, I’ll go bankrupt! I don’t have any money!” Or maybe you just believe that’s what happens in a personal injury case.

But the truth is that personal injury cases rarely ruin anyone’s life, and the person responsible for your injury probably won’t end up paying for it themselves. Most importantly, if you’re inundated with medical bills you can’t pay and are unable to work, then the only person suffering is you.

Let’s take a look at what actually happens when you seek compensation for a personal injury. Here are some things everyone should know about how personal injury claims work:

The Party Responsible For Your Injury And The Party That Pays Your Compensation Are Usually Not The Same

First, it’s important to understand that the first step in seeking compensation is usually to make a claim with an insurance company. Yes, you and your attorney will talk about the responsible party – another driver who hit your car, a business where you got hurt, a truck driver who crashed into your bike, etc. But in the vast majority of cases, those people and businesses have insurance for just such a situation.

You have car insurance, right? Even though you drive carefully and try to avoid accidents, you’re human and you know that mistakes happen. And if you were to make a mistake while driving, or get in an accident due to circumstances you can’t control, you wouldn’t want to be financially ruined trying to pay the cost. So, you purchase insurance – in case you accidentally hit another vehicle, in case an uninsured motorist hits you, in case you skid on a slick spot and crash, etc.

As it turns out, other drivers usually do the same thing (except for the uninsured motorists, which is why that type of coverage exists). But most drivers are insured. If you are hit by a car and the other driver is at fault, your personal injury attorney is going to start by making a claim with the other driver’s insurance carrier. Their interest in who caused the accident is mostly so they can figure out whose insurance carrier to contact.

Most Personal Injury Lawsuits Are Against Insurance Companies

In most cases, if it’s necessary to file a lawsuit, you’ll do it against the insurance company. We say “if” because most personal injury cases settle out of court. We always start by trying to negotiate with the insurer, and in many cases, we’re able to reach an appropriate settlement for the client, saving them time and money. However, sometimes the insurance company is adamant about not paying a claim, and it becomes necessary to sue them.

You definitely shouldn’t feel bad about suing an insurance company. First, most insurers are very large corporations with deep pockets. Your claim will barely make a dent in their bottom line. Second, they’re in the business of providing coverage for auto accidents. Many of them spend a small fortune on ads to convince people they’re going to help after a car accident. It’s perfectly reasonable to expect them to keep their promises. Third, they’re in the habit of denying claims that they should pay. They know that many people won’t fight an insurance company if their claim is denied, but will instead just pay out of pocket.

Insurance Isn’t Just For Car Accidents

If your injury wasn’t caused by a car accident, you may be wondering where that leaves you. But in other situations, there is often still an insurer we can make a claim against. For example, if you get hurt in a store, the business owner should have liability insurance that will cover your injuries. Even if you’re hurt on private property, like a friend’s home, there is likely a homeowner’s or renter’s insurance policy that may cover your accident.

Of course, that doesn’t mean the property owner wants you to make a claim. One situation we often see is when a person gets hurt at a small “mom and pop” type business. Larger companies tend to have policies in place for dealing with on-site injuries and minimizing liability, and they expect their insurance company to handle any claims. With smaller businesses, sometimes the owner doesn’t understand how personal injury cases work. They may think the business will get sued and they’ll be forced to close their doors, even if they’re paying for insurance. Or they may worry that the bad publicity of a trial will hurt their business even if the insurance company does pay. They also may not want their insurance rates to go up.

For these reasons, Mom or Pop may ask an injured patron not to sue. They may beg you not to make a claim, or even offer you a small amount of money to forget the whole thing.

But the truth is that most of their fears are unfounded – it’s unlikely the store itself will be sued, and lawsuits against insurance companies are common enough that they seldom make the news. Cases that settle without a lawsuit generate no publicity at all. As for their insurance rates, those may or may not go up depending on the situation and the insurance company. But most rate increases will not have a significant effect on a small business – and if they do, the business was probably already in trouble and on its way to bankruptcy anyway.

Moreover, agreeing not to pursue a claim can mean big financial problems for you. Accepting a small sum of money might seem like a good idea – until you get your medical bills and realize it wasn’t nearly enough to cover all of them. While filing a claim against the business’ insurance policy is unlikely to cause major financial distress for the company, paying tens of thousands of dollars in medical bills yourself could definitely cause you financial problems. In some cases, you may be left with chronic pain – and chronic medical bills – for the rest of your life. This may even impact your ability to work and earn a living. There is no reason you shouldn’t be compensated for the considerable expense your injury may cause you, and every reason to speak with an attorney before you make any agreements with the business or individual involved. Don’t agree to a settlement, and definitely don’t sign anything, until you’ve spoken with a qualified personal injury lawyer.

When The Insurance Company Doesn’t Pay, There Are Other Options

While it’s true that most personal injury cases involve going after insurance carriers, there are a few situations where we need to look at making a claim against other liable parties. Here are some situations where the at-fault party’s insurance may not be sufficient:

• When you have very large medical bills as the result of your injuries. Healthcare is expensive and costs can add up fast. Most insurance policies have a limit of what they will pay, even if the company makes no attempt to deny or fight your claim. In North Carolina, for example, the minimum requirement for car insurance is $30,000 in bodily injury liability and $25,000 in property damage. You can buy a policy that offers a higher amount of coverage, but many motorists don’t. So if you have $50,000 in medical bills, the other driver’s $30,000 policy is still only going to pay you $30,000. In this case, we may look for other liable parties to seek further compensation.
• When the other motorist is uninsured. In this case, we sometimes look at your own insurance policy, as your uninsured motorist coverage should kick in. However, that also has limits, and if you owe more than your policy covers, we will consider other options. With businesses, this is less likely to happen, but in rare cases, we have seen smaller businesses that completely lacked liability insurance, or whose insurance had lapsed due to nonpayment.
• When the insurance company has a valid reason for denying your claim. Insurance adjusters may deny claims for many reasons, some of which don’t hold up under scrutiny. For example, they may claim the accident was your fault, not their client’s, but this may not actually be the case. However, in a few situations, the circumstances of your accident may be specifically disallowed by the policy.

Does that mean you will have to sue a small business or individual in this situation? Not necessarily. You can, of course, always sue the person or business responsible for your accident. But this is only a worthwhile pursuit if the other party has significant assets you can seize. If we investigate and find that the responsible party has no money or valuable assets, we usually advise clients against a lawsuit, simply because it isn’t in their best interest. Receiving a judgment against someone who can’t pay won’t help you with your bills, and you will still have to pay court costs. It’s also a waste of time for everyone involved.

To return to your concerns about “ruining” someone’s life or business, it’s only advisable to sue someone if they can afford to pay your claim. So if you do end up in the unlikely situation of pursuing a lawsuit against a person or small business, you’re not ruining anything – you’re simply asking for what you’re owed, from someone who can afford to pay it.

And if it’s not worth suing the responsible party? Again, we will make an effort to find other potentially liable parties. Depending on the situation, there may be other third parties or insurance carriers for third parties you could make a claim against.

You Should Speak With An Experienced Personal Injury Lawyer Before Making Any Decisions

An attorney will answer your questions and lay out your options so you can make the right decision for you. If you or a loved one have been seriously injured, you are affected not only by what has happened but by the lingering effects on your life. In this tough situation, you need an experienced team that will support you on your road to recovery. Contact Tatum & Atkinson today by calling (800) 529-0804. For personal injury cases in North Carolina, you only have three years (sometimes less) from the date of the accident to file a lawsuit before you lose the opportunity. The sooner you begin the process, the sooner we can get you paid.